+0  
 
0
52
2
avatar+201 

A stock investment went up 25% in 2006. Starting at this increased value, what percent would it have to go down in 2007 to be back to its original price at the beginning of 2006?

 Apr 6, 2020
 #1
avatar+252 
+2

It would have to go down 20%

It would become 125%. 25/125=.2, which is 20%

 

coolsmileysmileysmileycool

 Apr 6, 2020
 #2
avatar+111329 
+2

Let the  value of the  investment  at the start  = A

 

At the  end of 2006  the value is  1.25A

 

So....we  need  to  solve  this

 

(1.25)A  *  x  =  A        divide  both  sides  by  A

 

1.25 x  =   1            divide  both  sides  by 1.25

 

x = 1 / 1.25   =    4/5

 

So  x  = 4/5  =  .80

 

Then the investment's  value at  the end of 2007  needs to be 80%  of its  value at the  end of 2006

 

So......it  would need to lose 20%  of its value 

 

 

cool cool cool

 Apr 6, 2020

24 Online Users

avatar
avatar
avatar